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Life INSURANCE PLANS in simpler words

Life is full of uncertainties. None of us knows what the future holds; therefore we make an effort to secure our family's future by buying life insurance plans, which are usually of two types: full life and term life.

Whole life insurance is expensive. You pay for insurance and also for the investment portion, which might not be worth it. Whole life plans are of three types, traditional, universal and variable.

Term policies are ideal for anyone who wants to have insurance coverage, but cannot afford to pay very high premiums as is the case in other types of insurance. Among the two, term insurance often comes up as the perfect option.

What is Term Insurance?

Term insurance is the kind of life insurance plan that is offered for a fixed period of time or term at predetermined rate of premium. The term can be as small as one year or might extend for up to twenty years. You can choose term life insurance plan from among the many life insurance plans, as it will serve your purpose and will be budget-friendly at the same time.

What makes term insurance unique is that it is affordable and allows almost everyone to grab a term insurance plan for their family.

Annual Renewable Term (ART)

ART is the term insurance that is valid for a period of one year. At the end of the term, it has to be renewed. It can be renewed for 10-30 years as might be the case. In this form of term insurance plan, the premium keeps on increasing with the age of the policy holder.

Level Term Life Insurance

Level term insurance plan is more common than annual renewable term. In this form, the premium amount remains static for a specified period of years. The term can vary from 10, 15, 20 and 30 respectively. You will have to shell out a higher premium if the plan you have opted for is for a longer period, 20 years for instance.

Term insurance plans can prove to be very beneficial, both in the short or long run. It will come to your family's aid when you are no longer alive. It will take care of your family's expenses and will fund your child's school/college education, and also pay off your outstanding bills if any.

Who Can Help You?

When looking for term life insurance plans, ask your friends and peers for advice. They might be using a certain plan and can tell the pros and cons of it. On the basis of their feedback, you can make up your mind and pick a plan that works for you.

Insurance agents can offer you expert advice since they are from the industry. But you need to do your homework as well. Reason being that you can't rely completely on them as they get commission for every lead that they make. It is quite possible that they suggest you an expensive plan because it will fetch them more money.

If you want to reap in the full benefits of term life insurance plans, you should be regular in paying your premium amount. This will ensure that your family members get the full death benefit after you are gone.

So what are you waiting for? Look up for term life insurance plans and lock in your insurance policy. You will die in peace assured that your family will not face any financial troubles after your death.